Microsoft's poor performance is partly due to an initially unreliable console and lack of mainstream influential titles that resonate with the Japanese.

The advertising has also been terrible and could have had been handled much better considering the huge amount Microsoft has spent on advertising there.

Another common reason is the Japanese are more space conscience because of their living restrictions (apartments, small houses) and already have PS3's and Wii's so can't justify the extra space used and few extra features/games offered by the Xbox360.

The Xbox360 controller while much better than the original Xbox Duke ans S controllers isn't great for those with small hands.